Philippine Q4 Growth Tops Expectations

1/30/2014 1:15 AM ET

The Philippine economy grew more than expected at the end of 2013, taking the full-year growth above the government target despite enduring a series of calamities.

Gross domestic product rose 6.5 percent in the fourth quarter from last year, the National Statistical Coordination Board said Thursday. The growth exceeded the 6 percent increase forecast by economists.

However, the growth was the lowest annual increase since the second quarter of 2013 and down from the revised 6.9 percent expansion in the third quarter.

Quarter-on-quarter, GDP rose a seasonally adjusted 1.5 percent, which was faster than the 1.3 percent growth seen in the third quarter.

For 2013 as a whole, the economy grew 7.2 percent, exceeding the government target of 6-7 percent.

All the three major components of production underpinned GDP growth. The agriculture sector grew 1.1 percent annually in the fourth quarter, while industry and services logged robust 8.4 percent and 6.5 percent increases, respectively.

On the expenditure front, household spending climbed 5.6 percent. But government expenditure fell 5.2 percent. Investment rose 5.7 percent, down from the 15.6 percent expansion seen in the prior quarter.

Economic Planning Secretary Arsenio Balisacan said the impact of the typhoon will be more pronounced in the first quarter of 2014. But he said, "We are optimistic that the Philippine economy will remain strong in 2014."

The government expects global recovery and the reconstruction efforts in the typhoon-hit areas to boost economic activity.

Krystal Tan, the Asia economist at Capital Economics, also said GDP growth should remain strong. The economist expects 6.5 percent growth for 2014, while the government estimates 6.5-7.5 percent growth.